Warranty

Nervous newbie [me] looked into warranty coverage. Found a broker who found the best for me in S. Carolina. Five year engine and drive train coverage $100 deductible, $3K. Seems like $600/year is a small price to pay for the peace of mind. Your thoughts?

Warranties are good for stupid simple issues.. I have yet to see one pay for an 18K engine replacement. We stopped even accepting vehicles that will be paid for by any warranty coverage after lots of our time wasted over and over again by polyester suit wearing, cubicle sitting clowns who are paid to create complications for all involved and squirm out of every claim in any way possible. Start your own savings account for the repairs and you'll be better off.

A search of this forum turns up several cases where extended warranties have paid for remanufactured engines. I've spoken with my Porsche dealer and the two indies I use, and all have had no trouble getting Fidelity, Warranty Direct and Easy Care to pay for engines. They mentioned several others but I forgot the names. That said, I was told by them that most warranties have some clause that says they won't pay out more than the car's dealer value. Most if not all 996s are still deemed worth more than the cost of a remanufactured engine, but many older Boxsters may not be. My feeling is that powertrain-only warranties are somewhat costly for what they offer with most cars, but in the case of the 996 where there seems to be a heightened possibility of complete engine destruction, it might not be such a terrible value. If you can obtain a warranty that covers other systems as well, you might end up getting some of the cost returned, whereas with the powertrain warranty you'd need to have the engine or trans go in order to collect.

My first hand experiences do not parallel what your findings have turned up in your research. We have submitted dozens of claims to warranty companies for complete engines and none of them have been paid; all were either quoted the same or less than the dealer price for the same engine. The bigger the numbers the more they contest the claims and remember that the representatives often get paid based on how much they SAVE the company in claims, which makes it a nightmare to communicate and deal with them. These date back to as early as 2003 when the vehicle values were much higher than they are today. Just speaking from first hand experience. I believe that getting the info from a worst case scenario up front is key. Results may vary.

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$600/year for a good full coverage drive train warranty ain't bad but the coverage is only as good as the company that underwrites it. Talk to the place you'll have the car serviced and any warranty work done and get the techs' opinion about the warranty company. The techs I talk to about 3rd party warranties tell me some companies are relatively painless (for an "insurance" company) to deal with and others can be a real pain. In the case you have to file a claim it is the tech that answers most of the questions about the car's history, condition, usage, etc. by the adjuster looking for fraud, abuse, neglect or any "valid" reason to deny the claim. Sincerely, Macster.

Jake, Sorry to bother you but could you be more specific about why they will not cover, for instance an IMBS failure? Is it becuase you have to be a Porsche Dealer for the warranty? I too was considering the extra $3000 for a warranty/MBI. What, if any warranty company would you recommend?

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I do not recommend any warranty company. Save your money toward the repair yourself and at least you won't have to deal with broken promises and red tape. As I stated we have NEVER had any warranty company pay for a failed engine; no matter the mode of failure. The last one stayed here 3 months while we battled back and forth with the warranty clowns before the owner got pissed and just took out a loan to pay me directly. When these companies face a 20K expenditure they fight hard, no matter if a dealer is doing the work or not. We don't have time for the arguments and back and forth dialog with forms and other BS. They try to discourage you so much that you just give up and some people do. We have dealt with all the big names and quite honestly the bigger the name the more effective their fight has been.

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As well, I suspect the tech's attitude plays a role. I can see why some techs could have much poorer results than others. Certainly in the case of a company like Fidelity who depends on dealerships to sell their warranties, it would make little sense in the long run to encourage their adjusters to deny claims that the service department vouches for as legitimate.

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I have to agree. I too have heard of lots of people claiming they recieved new engines. However, these big companies would not stay in business very long charging $3-4K for a warranty policy and paying everyone $20-30K for a new engines, plus all the other stuff they are supposed to cover. It makes no business sense. I bought an EasyCare policy for my 997.1 GT3 just before the factory warranty expired. I felt pretty good for a year with zero claims. I ended up hitting a pot hole and ruining my factory wheel (black from the factory). The Total Care policy covers road hazards and wheel replacement. However, when EasyCare saw the price of the new wheel, they denied the claim. The reason was that I had thrown the old tire away and they needed "proof" that the tire had 3/32" of tread....like that would have made a difference. Since I did not have the old tire, they would not pay. The dealer was ZERO help. They will find every loophole possible to deny the claim. I know there will be people saying their polcies paid off many times over....maybe so. But these are busienss enterprises maximizing profits, which I fully understand. Just don't expect free stuff. I ended up cancelling the policy and getting $3800 of my original $4200 policy cost back. It now sits in a bank waiting for something to go wrong. Today, I'm still up $3800 plus interest. Just sayin....

A porsche dealer said he could not get a company that would replace/repair a motor in an 2004 c4s with 28k miles if the ims failed,I walked and glad I did.

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Good thread. Although I have had excellent luck with my warranty company, they never, not once, fought any claim. From hood struts, $1800.00 in audio repairs, $1200.00 in vario cam solenoieds, to a "weeping" differential seal and some other small stuff. They even covered a rental car when the car was kept for a few days to figure out the audio problem. Yet I always figured that they either never had or never paid a claim for an engine failure. As mentioned, it's a for profit business and their actuarial folks would probably decide to never issue coverage on our cars if they were paying for engines. So happy was I with this company that I called to buy another few years as the warranty expires this week. They never took my name or contract information, just simply said sorry, we only sell the warranty one time and only at point of purchase through select dealers. I'll be shopping for another warranty through my local p-car dealer and will probe hard on the possibility of engine coverage, and ask if having a non OE IMSB would impact any coverage of the engine. And this is from a guy that never ever buys an extended warranty or service plan on anything. I only had it on the C4S because it was transferred to me when I bought the car. Just dumb luck in my case.

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You seem to be insinuating they are all lying. Yet given the nature of the internet I would expect to hear more negative rants from Porsche owners whose engine replacement claims were denied. Yet Jake is the only one I have heard with that experience. Virtually all of the indies who participate in my regional PCA chapter have said they have had engines covered under extended warranties, and none have said they had a claim denied. Ditto for two Porsche dealers. What some did say was that a few warranty companies insisted on sourcing a used engine vs remanufactured. But even in those cases the claim wasn't denied, and the customers had the option of paying the difference up to the cost of a remanufactured engine. What also was said was that some warranties have maintenance requirements (oil service) far shorter than the manufacturer's recommended, and if the owner doesn't have his paperwork in order the warranty company can easily deny any claim even if it has nothing to do with a lubricated part. The problem comes when people DIY their oil service rather than have invoices from a licensed shop, as some adjusters have called BS on it. Yes but you have to realize that Porsches represent a very tiny fraction of the policies they sell, and only a very tiny fraction of those ever need an engine replaced. Where warranty companies make their profit is from overall sales far exceeding overall payouts. If sales of new warranties plummets, that's much worse for business than an occasional large payout. What truly makes no business sense is a warranty company denying large claims and expecting word won't get out on the internet and negatively impact future policy sales. For the car dealers, if they sell someone a warranty at $1000 profit and a large claim is denied, they stand to lose the customer and untold tens of thousands of future profit. In that case, the dealer isn't likely to continue selling that company's warranties. It therefore stands to reason that dealers have especially good "luck" getting claims paid by the warranty company whose product they sell. Which is not to say a claim won't ever or hasn't ever been denied, but all involved do have more of a vested interest in keeping the customer happy than where someone buys a warranty off the internet and uses it at some indie shop. Moreso if that indie has a bad attitude toward warranty companies and their adjusters. How do you know it would not have made a difference? It makes perfect sense that a contract would stipulate that tires must be maintained at >3/32" (pretty much the standard for tire replacement). I can certainly see them denying a claim for a new rim if it was damaged because a bald tire blew out. Here's a case in point: I've got the same Bridgestone tires on my Porsche and Bimmer. They have a 40,000 mile tread life warranty, but it stipulates that they tires must be rotated at certain intervals. I just replaced the ones on my Bimmer at 28,000 and got a large credit toward a new set. OTOH I also recently replaced the rears on the Porsche at 14,000 and got zilch from the warranty. Why? Because with different sizes front and rear, I didn't think there was any way I could satisfy the rotation requirement so I didn't bother. The tire dealer informed me that I could have them dismounted, reversed, and remounted and that would count. That's what I will do this time. Interest? In a bank? Today? Surely you jest

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I can see this.....first off they will require you to have every single piece of maintenance work done, by an authorized dealer, at the corrent time. Then if you have ANY aftermarket components on the engine or any suggestion of a non-approved part or lubricant having been used, they'll deny the claim. I had a 1 year EasyCare warranty when I got my car and Jake wouldn't do the IMS and clutch work because I wanted him to consider my warranty policy if he found anything that could be claimed. He told me exactly what he states above and I ended up taking it to the dealer to get the work done. I can only imagine what a royal nightmare it must be having to fight for weeks or months over getting paid for this kind of work........as if cash flow isn't a difficult enough problem to manage for a small business, then you have this mess to have to work through!! EasyCare wanted to sell me an additional 2 year warranty when my 1 year ran out, but their price was unresonable IMO so I turned them down. The one reason for even thinking about buying it would be for the engine problem, and in light of Jake's and others experiences, it would have been highly unlikely they wouldn't have paid out anyway!

Its not the cash flow that made my decisions.. It was having to deal with slimy, excuse making clowns who wouldn't know a piston from a crankshaft if both fell out of the sky and landed in their cubicle. The last "adjuster" that came here to look at a failing IMS Bearing got to the car in question before I did. He was wearing a safari hat and a vest with flashlights and measuring tapes hanging on it. I swear the guy looked like Frank Buck! I walked up and found him with his feet hanging out of the car while he was under the dash while the car is on the lift with the tranny pulled out of it ready for him to review the IMS Bearing failure. I asked him what the hell he was doing and he replied "inspecting the intermediate bearing". I said "the car is on the lift because the IMS Bearing is failing inside the engine". He responded "Oh, Ford vans have worn intermediate bearings in the steering column so thats where I started looking". I shook my head and walked away. Thats the caliber of who you'll be dealing with. It pisses me off to have my time wasted.

kdieter, Right....I routinely run bald tires on my GT3. Seriously, it was obvious the damage from the impact had nothing to do with tread depth. They could also see my other 3 tires, but then I could have been lying about those 3 also.... Anyway, the tire depth requirement is for very different purposes which I understand. The point is that the warranty company obviously was using the fine print to deny the claim, and will do so as noted by others. As for the interest in the bank, it was surely in jest....

My car had an engine replaced with aftermarket warranty, $12K, back in 2006.

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Which company did you buy this aftermarket warranty from, out of curiosity?

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Your kidding right? If that were the case there would be NO insurance companies of any kind. Have you seen a catastrophic hospital bill lately? And...if the number of 996's "blew up" just a fraction of what is implied in these forums, our cars would be uninsurable and/or have certain parts of the car excluded. I have a warranty that has almost paid for itself with 20 months and 17k miles to go. If the engine blows up...and the cause is a covered part, then they will either replace the engine, or write me a check. If not, well, that's what lawyers are for.

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I don't understand your point. No, I am not kidding... Insurance companies are like casinos...the house aways wins. Otherwise, there is no business. Do the math: for every $20K engine replaced, there needs to be 5 people who got nothing for their $5K policy (as example). We hear on these forums about engines getting replaced all the time (do a search!). While the number of ACTUAL engines as a % may be low, the % claimed on these posts are high. The people who bought the policy and had no claims generally do not post. They paid to protect themselves and are probably satisified...that is called "insurance". I do not imply any of this is wrong. My only point is that buying insurance is a personal decision. If you pay $5K for a policy and get a $20K engine, that's great. However, many others got nothing. That is my simple point. It is amazing how we all try to convince each other what is "right" when it is really a personal decision...there is no right or wrong answer.

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On the same token, the people whose engines fail and are covered by an extended warranty post less often, while those whose claims are denied post more often. My experience with Mercury for extended warranties has been good -- they paid for a new transmission on my SUV which totaled more than the price I paid for the policy, and I've already claimed 50% of the cost of the policy on my Cayman S (water pump) and I'm in my first of four years of coverage. However, statistically (if money is the only object), most people will not draw what they pay for a policy. I liken extended warranties to collision insurance: odds are you won't need it, but at least you won't have to worry about a disastrous failure of some kind. EDIT: Unfortunately, as of last month, Mercury doesn't offer coverage for Porsches through my broker. Boo.

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Thanks. Your experience supports what I was saying. You are an example of a "winner", twice apparently. Second, your point is well made that it is a personal decision based on risk tolerance. It's like me asking you if I should buy a red or white car. And finally, there is a reason Mercury does not warranty Porsches anymore through your broker...they probably did not meet their ROI targets. Thank goodness we all still have options to buy or not buy policies. That is a good thing.

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Very welcome! I think Gonzo911 sounded incredulous in his reply to you because it seemed you and Flat6 were insinuating that no extended warranty company would ever cover a $20k claim, which isn't true. I mostly weighed in because (while Flat6's products look impressive and seem to have a good rep) it makes me a little uncomfortable that his company is in direct competition with extended warranty companies: they both sell peace of mind. Flat6 sells a preventative measure, while warranty companies let you bet against your good luck.

very pleased with the warranty I bought thru AAA. So far, two claims totaling >2k, paid with out a wimper.

Were the Flat 6 engines that were involved in a claim to be rebuilt to facotry spec or to Flat 6 spec?

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We only produce engines to our own spec. That said, the engine was proposed to be built at a factory spec and then the customer was to pay the difference afterward and on a separate invoice. But that was in 2009, I haven't even considered or proposed a warranty based job since then.

There are many factors insurance companies not yet mentioned in this tread. There is a high number of people who buy warranties that pay up front for the policy and will most likely sell the car well before the coverage expires, or in some cases crash the car. This amounts to an important revenue source for the insurance company. The other revenue source not yet mentioned comes from investment revenue on the premiums paid in advance. Regarding payment of new expensive 996 engines, I am a statistic having my 01 996 engine blow up due to intermix, then bought a crate factory engine $14k several years ago.. And no I didn't have any warranty of coverage.. If I had the choice to purchase a warranty that didn't guarantee engine replacement.. I would self insure before buying a dodgy policy. Enjoy

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We may be making the same point in a different way. I agree that whether or not to buy an extended warranty is a personal decision. As a matter of fact, I was floored that someone with KK's mechanical abilities would even consider one The fact that many extended warranty companies will cover our cars, even with the "20+ known catastrophic failures" actually makes me feel better about their reliability. As you said, if the number of failures where high enough, the "casinos" would know that based on their data and exclude our cars (or failures attributed to certain parts). Otherwise, they would certainly lose money. But they don't.

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Well said.

I did in fact consider buying a warranty but ended up taking JR's great advice.

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Wow - I guess I'm amazed that people would be willing to pay $14-$20k for the repairs necessary. I suppose if someone blows their engine and has a warranty, they go elsewhere then. Do all of your customers come to you sans warranty?